Trickle Down Theory: Powell Chastises Trump, Praises Himself
|In a speech today, Fed Chair Jerome Powell took a swipe at Trump, then patted himself and the Fed on the back. Powell Snipes at Trump Image courtesy of Hedgeye Inquiring minds are tuning into a Powell Speech in which he chastises Trump and praises himself for a job well done. In a blast pointed directly at Trump, Powell proclaimed "The Fed is insulated from short-term political pressures—what is often referred to as our 'independence.''" Self-Praise for Listening At the heart of the review are our Fed Listens events, which include town hall–style meetings in all 12 Federal Reserve Districts. These meetings bring together people with wide-ranging perspectives, interests, and expertise. We also want to benefit from the insights of leading economic researchers. We have been listening. What have we heard? Scholars at the Chicago event offered a range of views on how well our monetary policy tools have effectively promoted our dual mandate. We learned more about cutting-edge ways to measure job market conditions. We heard the latest perspectives on what financial and trade links with the rest of the world mean for the conduct of monetary policy. We heard scholarly views on the interplay between monetary policy and financial stability. And we heard a review of the clarity and the efficacy of our communications. In Praise of Fundamentals Solid fundamentals are supporting continued growth and strong job creation, keeping the unemployment rate near historic lows. Although inflation has been running somewhat below our symmetric 2 percent objective, we have expected it to pick up, supported by solid growth and a strong job market. Along with this favorable picture, we have been mindful of some ongoing crosscurrents, including trade developments and concerns about global growth. When the FOMC met at the start of May, tentative evidence suggested these crosscurrents were moderating, and we saw no strong case for adjusting our policy rate. Trickle Down Theory Returns Like many others at the conference, I was particularly struck by two panels that included people who work every day in low- and middle-income communities. What we heard, loud and clear, was that today's tight labor markets mean that the benefits of this long recovery are now reaching these communities to a degree that has not been felt for many years. Hallelujah! What a sappy, self-congratulatory speech. Hallelujah! Trickle down has arrived just in the nick-of-time for the next recession. Trump's response will likely provide more amusement. Hello Jerome Powell - We Still Have Questions Dear Jerome Powell, instead of patting yourself on the back and answering fluff prepared questions, how about addressing mine? Answers Please Hello Jerome Powell, We Have Questions Please have a go at it, Mr. Powell.
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